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There exist several key pitfalls that contractors can easily fall into with insurance. While most contractors are focusing on supply chain issues and labor challenges, there continue to be missed opportunities regarding contractor’s insurance.  Contractors, as an industry, continue to be battered by “new” challenges:  COVID-19 issues, supply chain disruption, and now inflation.  However, insurance pitfalls can have far more catastrophic effects on a general contractor, even if they are not as trending of a topic.  Insurance for contractors presents great variability in coverage options, with drastically different impacts. The nature of contractors to “bid” on almost everything they do often drives them to ask for insurance bids as if they are a commodity.  Every penny counts.  The challenge is there are so many variants of coverage, that comparing apples-to-apples is hard and most general and artisan contractors have neither the time nor skills to truly evaluate insurance.  Contractors are experts in construction, not insurance. One area that is often misunderstood is the coverage for “completed operations.” The entire purpose of a contractor’s general liability policy is to respond to a claim when someone is physically injured or has property damage caused by the contractor.  If that injured party could sue to recover damages from the contractor, the insurance policy will step in, defend the contractor, and pay out any damages. However, if you look deeper into liability protection, there are actually two types of coverage, separated by time.  These apply to all types of contractors: general, plumbing, electrical, or any other type – just as long as you are being paid to do construction activities on a building. The types are Ongoing Operations and Completed Operations. Ongoing Operations provides coverage while work is going on.  This part of the policy insures activities while contractors are on the job, during the course of construction. Completed Operations provides coverage once the job is finished.  Once the contractor’s work is “complete” and they are no longer on the job site, this section of coverage continues to insure against injuries or damage the building might cause. Many general contractors, artisan contractors, development companies, and property owners focus on the ongoing operations type of coverage.  They think of insurance in terms of being “on the job” and the injuries or damage that can occur while construction is ongoing.  During construction, the focus is on the “here and now” and when and how the project is going to get done. Thinking about the exposure of the building five years after it is completed becomes an afterthought. Here is a phone call I sometimes receive: “Hello, Shane, I’ve finished the job at 123 Main St.  Can we just let the insurance lapse now and get some of my money back?” The pitfall is that the policy also covers all the work the contractor has previously done, not just the job at 123 Main St.  As soon as the policy is cancelled, or allowed to lapse, all coverage for the prior work done everywhere, including, 123 Main

Insurance

Contractor Pitfalls Around Insurance

There exist several key pitfalls that contractors can easily fall into with insurance. While most contractors are focusing on supply chain issues and labor challenges, there continue to be missed opportunities regarding contractor’s insurance.  Contractors, as an industry, continue to be battered by “new” challenges:  COVID-19 issues, supply chain disruption, and now inflation.  However, insurance … Read more

July 7, 2022

Loss of Business Income, Maintaining Business Continuity & Continuing a Business After a Major Loss

When I consult with clients about their business insurance, we typically review two main categories of insurance: 1) Protection in case they injure someone else, and must compensate them, and 2) protection of your own assets in case they are damaged/destroyed. In terms of the second category, businesses need to ensure their policies protect their … Read more

June 5, 2022

Ask the Professionals – Apr 3

Take a look at”Ask the Professionals” this month our principal, Shane Lipson, provides interesting information about Workers Compensation Insurance. Bernie del Hierro Vice President / Escrow Officer Lone Star Title Question: Why is title insurance important? When you purchase real property, title insurance protects you against defects or claims for past occurrences! Any tips on … Read more

April 5, 2022

Ask the professionals- Mar 7

Ask the professionals  We invite you to take a look at our monthly “Ask the Professionals” session where we’ll be talking about our commercial auto. Our agency principal, Shane Lipson, along with Jimmy Garza of Jimmy Garza Emergency Water Disposal, Thomas B. Goldfarb of Goldfarb Financial and Bernie del Hierro of Lone Star Title Company … Read more

March 7, 2022

Ask the professionals

  Ask the professionals  Do not be left wondering…… join us in the El Paso Inc. this month as our agency principal, Shane Lipson, along with Jimmy Garza of Jimmy Garza emergency water removal, Thomas B. Goldfarb of Goldfarb Financial and Bernie del Hierro of Lone Star Title Company answer some very important questions.   … Read more

February 7, 2022

We’re expanding our local service area.

 Mt. Franklin Insurance would like to announce that we are adding new personalized Insurance services in San Antonio, TX. Call now at (830) 360-8660 We are ready to continue to offer our excellent customer service and help you find the best personal and business insurance.

February 1, 2022

Different types of commercial insurance you may need

Different types of commercial insurance you may need                                                                                       Click on following link … Read more

December 15, 2021

Understanding Your BOP’s Interruption Coverage

A business owner’s policy, or BOP, contains several critical elements of business insurance. Among these, you will likely find business interruption insurance—one of the most critical elements of protection any business needs. If you don’t fully understand this coverage, you might not be able to use it to your advantage. Let’s explore the topic a … Read more

November 30, 2021

3 Signs that You’re a Distracted Driver and Don’t Know It

In the last decade, the number of auto insurance claims that arise from distracted driving accidents has increased significantly. By definition, this is an accident caused by the fact that the involved driver wasn’t paying attention to the road.   While the use of mobile devices is a big contributor to the rise in distracted … Read more

November 16, 2021

Daylight Saving Time Ends November 7, 2021

Daylight Saving Time ends this Sunday, November 7 at 2:00 a.m.  As we fall back and turn our clocks back, there is no better time than now to conduct some basic winter home maintenance.          At Mt. Franklin Insurance, we want your winter season to start off on the right foot, which is why … Read more

November 4, 2021

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